DPMC STATUTORY AUTHORITY: DESIGN AND CONSTRUCTION
Prequalification of Construction Professionals/Award of Professional Service Contracts
N.J.S.A. 52:34-9.1. Policy on certain State contracts for professional services
It is the policy of this State that State contracts for architectural, engineering and land surveying services shall be
publicly announced prior to being awarded and that contracts for these services shall be negotiated on the basis of
demonstrated competence and qualifications for the type of professional services required and at fair and reasonable
compensation.
N.J.S.A. 52:34-9.2. Definitions relative to contracting for certain professional services by State agencies
As used in this act:
"Agency" means any of the principal departments in the Executive Branch of State Government, and any division,
board, bureau, office, commission or other instrumentality created by a principal department and any independent
State authority, commission, instrumentality or agency, which is authorized by law to contract for professional
architectural, engineering or land surveying services;
"Compensation" means the basis of payment by an agency for professional architectural, engineering or land
surveying services;
"Professional firm" means any individual, firm, partnership, corporation, association or other legal entity permitted
by law to provide professional architectural, engineering, or land surveying services in this State;
"Professional architectural, engineering and land surveying services" means those services, including planning,
environmental, and construction inspection services required for the development and construction of projects,
within the scope of the practice of architecture, professional engineering or professional land surveying as defined
by the laws of this State or those performed by an architect, professional engineer or professional land surveyor in
connection with his professional employment practice.
N.J.S.A. 52:34-9.3. Filing of current statement of qualifications, supporting data with agency; fee
A professional firm which wishes to be considered qualified to provide professional architectural, engineering, or
land surveying services to an agency seeking to negotiate a contract or agreement for the performance of such
services shall file or shall have filed with the agency a current statement of qualifications and supporting data. Such
a statement may be filed at any time during a calendar year, and a $ 100 fee shall be remitted to the State Treasurer
by the professional firm at the time each statement is filed. The content of any such statement shall conform to such
regulations with respect thereto as the State Treasurer, in accordance with the "Administrative Procedure Act,"
P.L.1968, c. 410, shall promulgate. For the purposes of this section and section 5 of this act, no statement which
shall have been filed more than two years prior to the publication of an advertisement pursuant to the provisions of
section 4 of this act shall be deemed to be a current statement with respect to qualification of the firm which shall
have filed the statement to provide professional architectural, engineering, or land surveying services under any
contract or agreement of which notice is given through that advertisement.
A statement of qualifications and supporting data filed with an agency under this section shall be a public record for
all purposes of P.L. 1963, c. 73.
The fee prescribed hereunder shall not apply to any statements filed before the effective date of P.L. 2003, c. 117.
N.J.S.A. 52:34-9.4. Public advertisement for proposals required
Notwithstanding the provisions of sections 2 through 4 of P.L. 1954, c. 48, a contract or agreement with an agency
for the procurement of professional architectural, engineering, or land surveying services shall be publicly
advertised prior to the solicitation of proposals or expressions of interest from interested firms. To the extent
consistent with the purposes and provisions of this section, the advertisement shall conform to the requirements
applicable under subsections (a) and (b) of section 7 of P.L. 1954, c. 48 or may be publicly advertised through
electronic means. The advertisement shall include a statement of the criteria by which the agency seeking to procure
those professional services shall evaluate the technical qualifications of professional firms and determine the order
of preference to be used in designating the firms most highly qualified to perform the services; this statement shall
either set forth explicitly and in full the terms of those criteria or identify them by reference to the regulation or
regulations in which those criteria shall have been promulgated as required by subsection c. of section 5 of this act.
In addition, the advertisement shall include notice that professional firms wishing to be considered for selection as a
potential provider of such services in connection with a proposed project must have submitted to the agency a
current statement of qualifications and supporting data as prescribed in section 3 of this act.
N.J.S.A. 52:34-9.5. Filing of current statement of qualifications, supporting data necessary for awarding of
contract, agreement
a. In the procurement of architectural, engineering and land surveying services, no agency shall make, negotiate, or
award a contract or agreement for the performance of such services with or to any professional firm which has not
filed with the agency a current statement of qualifications and supporting data as prescribed under section 3 of this
act.
b. For each proposed project, an agency shall evaluate current statements of qualifications and supporting data on
file with the agency. The agency may solicit proposals or expressions of interest unique to the specific project which
would in narrative form outline design concepts and proposed methods of approach to the assignment. The agency
shall select, in order of preference, based upon the criteria included in the advertisement required by section 4 of this
act, at least three professional firms deemed to be the most highly qualified to provide the services required, except
that the agency may select fewer professional firms if fewer such firms responded to the solicitation or meet the
qualifications required for the project.
c. An agency which intends or expects to make, negotiate or award a contract or agreement for the procurement of
professional architectural, engineering, or land surveying services shall, before publishing an advertisement of
notice with respect to any such contract or agreement, have adopted by regulation and have promulgated, in
accordance with the "Administrative Procedure Act," P.L. 1968, c. 410, the criteria by which it shall with respect to
any such contract or agreement make the selection of qualified firms as prescribed by subsection b. of this section.
The provisions of this subsection shall not be construed to require the adoption by an agency of regulations
regarding the selection criteria to be applicable with respect to a particular contract if such regulations were
previously promulgated and remain in effect with respect to such a contract.
N.J.S.A. 52:34-9.6. Submission of fee proposal
Once the top three or more ranked firms have been identified, each firm, at the request of the agency, shall submit a
fee proposal. The firms shall not be told of their ranking position at that time. Using the three fee proposals to
provide a general guideline, an agency shall negotiate a contract with the most technically qualified professional
firm for architectural, engineering or land surveying services at compensation which the agency determines to be
fair and reasonable to the State of New Jersey. In making this determination, the agency shall take into account the
estimated value of the services to be rendered and the scope, complexity, and professional nature thereof. Should the
agency be unable to negotiate a satisfactory contract with the professional firm considered to be the most qualified at
a fee the agency determines to be fair and reasonable, negotiations with that professional firm shall be formally
terminated. The agency shall then undertake negotiations with the second most qualified professional firm. Failing
accord with the second most qualified professional firm, the agency shall formally terminate negotiations. The
agency shall then undertake negotiations with the third most qualified professional firm. Should the agency be
unable to negotiate a satisfactory contract with any of the selected professional firms, it shall select additional
professional firms in order of their competence and qualifications and it shall continue negotiations in accordance
with this section until an agreement is reached.
N.J.S.A. 52:34-9.7. Applicability of act restricted to contracts for services in excess of $25,000; use of other
procurement processes
Notwithstanding the provisions of section 2 of P.L. 1954, c. 48 to the contrary, the provisions of this act shall only
apply to contracts for architectural, engineering and land surveying services in excess of $ 25,000. Nothing in this
act shall preclude a State agency from using procurement processes other than those prescribed herein if those
processes have been approved by the federal government or other State statute or if an emergency has been declared
by the chief executive officer of the agency.
DPMC STATUTORY AUTHORITY: DESIGN AND CONSTRUCTION
Classification of Contractors
N.J.S.A. 52:35-1. "Person" , "official" and "officer" defined
As used in this chapter:
"Person" means and includes any individual, copartnership, association, corporation or joint stock company, their
lessees, trustees, assignees or receivers appointed by any court whatsoever.
"Official" and "officer" mean and include any official, officer, board, commission, committee, department or other
branch of the state government.
N.J.S.A. 52:35-2. Statement required from prospective bidders; contents; fee
Officials of the State shall require of all persons proposing to submit bids on public work to be furnished for or on
behalf of the State or any officer, board, commission, committee, department or other branch of the State
government, a statement under oath in response to a questionnaire, standardized for like classes of work, to be
submitted to such persons by such State official. The statement shall develop fully the financial ability, adequacy of
plant and equipment, organization and prior experience of the prospective bidder, and also such other pertinent and
material facts as may seem desirable. All persons shall remit a $ 100 fee to the State Treasurer at the time each
statement is filed. The fee shall not apply to any statements filed before the effective date of P.L. 2003, c. 117.
N.J.S.A. 52:35-3. Bidders to be classified; notice
The state officials shall classify all such prospective bidders as to the character and amount of public work on which
they shall be qualified to submit bids, and bids shall be accepted only from persons qualified in accordance with
such classification. The classification shall be made and an immediate notice thereof shall be sent to the prospective
bidder or bidders by registered mail within a period of eight days after the date of receipt of the statement in
response to the questionnaire.
N.J.S.A. 52:35-4. Hearing before state official on classification of bidders; change of classification
Any person after being notified of his classification by a state official and being dissatisfied therewith or with the
classification of other bidders, may request in writing a hearing before such state official, and may present such
further evidence with respect to the financial responsibility, organization, plant and equipment, or experience of
himself or other bidders as might tend to justify a different classification.
Where request is made for the change of classification of another bidder, the applicant shall notify such bidder by
registered mail of the time and place of hearing, and at the hearing shall present to the state official satisfactory
evidence to the effect that the notice was served as herein required, before any matters pertaining to a change of
classification of such bidder shall be taken up by the state official.
After hearing the additional evidence, the state official may, in his discretion, by appropriate ruling, change or retain
the classification of any bidder.
No change in classification to be effective for any public work, the letting of which has been duly advertised, shall
be made unless a written request as aforesaid shall have been received at least twenty days preceding the final day
for submission of bids.
All such requests for change in classification and notice of any action sent by registered mail to the parties directly
affected thereby, must be acted upon by the state official concerned at least twelve days prior to the date fixed for
the next opening of bids on any contract or contracts for which such persons might be qualified to bid as a result of
such reclassification.
N.J.S.A. 52:35-7. Rejection of bid upon subsequent developments affecting bidder's responsibility
Nothing contained in this chapter shall be construed as depriving any state official of the right to reject a bidder at
any time prior to the actual award of a contract, where there have been developments subsequent to the qualification
and classification of such bidder, which in the opinion of the awarding official would affect the responsibility of the
bidder. Before taking final action on any such bid, the state official concerned shall notify the bidder and give him
an opportunity to present any additional information which might tend to substantiate the existing classification.
N.J.S.A. 52:35-8. Submission of statement required for bidder
No person shall be qualified to bid on any contract, who shall not have submitted a statement as required by R.S.
52:35-2 within a period of 24 months preceding the date of opening of bids for such contract.
N.J.S.A. 52:35-11. Regulations by state officials; when effective
State officials may establish such reasonable regulations as to them may seem appropriate for controlling the
qualifications of prospective bidders. The regulations may fix the qualification requirements for bidders according to
available capital and equipment, and with due regard to experience and records of past performance, but the
qualification rating of any bidder shall not be influenced by his nationality or place of residence. No regulations of
any state official for controlling the qualifications of bidders shall become effective until at least thirty days after the
regulations shall have been formally adopted and published in not less than ten newspapers of this state.
DPMC STATUTORY AUTHORITY: DESIGN AND CONSTRUCTION
Award of Construction Contracts
N.J.S.A. 52:32-2. Separate plans, specifications for alteration, repair of public buildings
a. When the entire cost of the erection, construction, alteration or repair by the State of any public buildings in this
State will exceed $ 2,000.00, the person preparing the plans and specifications for such work may prepare separate
plans and specifications for: (1) the plumbing and gas fitting and all work kindred thereto; (2) the steam and hot
water heating and ventilating apparatus, steam power plants and all work kindred thereto; (3) electrical work; (4)
structural steel and ornamental iron work; and (5) general construction, which shall include all other work and
materials required for the completion of the project.
b. The board, body or person authorized by law to award contracts for such work shall advertise for, in the manner
provided by law, and receive (1) separate bids for each of the branches of work specified in subsection a. of this
section; or (2) bids for all the work and materials required to complete the project to be included in a single over-all
contract, in which case there shall be set forth in the bid the name or names of all subcontractors to whom the bidder
will subcontract for the furnishing of any of the work and materials specified in branches (1) through (4) in
subsection a. of this section, each of which subcontractors shall be qualified in accordance with chapter 35 of Title
52 of the Revised Statutes; or (3) both.
c. Contracts shall be awarded to the lowest responsible bidder in each branch of work in the case of separate bids
and to the single lowest responsible bidder in the case of single bids. In the event that a contract is advertised in
accordance with paragraph (3) of subsection b. of this section, the contract shall be awarded in the following
manner: If the sum total of the amounts bid by the lowest responsible bidder for each such branch is less than the
amount bid by the lowest responsible bidder for all of the work and materials, the board, body or person authorized
to award contracts for such work shall award separate contracts for each of such branches to the lowest responsible
bidder therefor, but if the sum total of the amount bid by the lowest responsible bidder for each such branch is not
less than the amount bid by the lowest responsible bidder for all the work and materials, the board, body or person
authorized to award the contract shall award a single over-all contract to the lowest responsible bidder for all of such
work and materials.
In every case in which a contract is awarded under paragraph (2) or (3) of subsection b. of this section, all payments
required to be made by the board, body or person awarding the contract under such contract for work and materials
supplied by a subcontractor may, upon the certification of the contractor of the amount due to the subcontractor, be
paid directly to the subcontractor. Payments to a subcontractor for work and materials supplied in connection with
the contract shall be made within 10 calendar days of the receipt of payment for that work or the delivery of those
materials by the subcontractor in accordance with the provisions of P.L.1991, c.133, and any regulations
promulgated thereunder.
N.J.S.A. 52:32-2.2. Historic buildings designated for purposes of special public contracts
a. The Legislature further finds that there are projects for the construction, renovation or restoration of public
buildings that must employ construction management personnel, engineers, architects and contractors whose skills
and expertise will identify, display and protect the historical, architectural, cultural and artistic significance of those
public buildings; and that buildings of this nature have the highest priority in being constructed, renovated and
restored in the most timely manner and with the highest managerial, professional and technical expertise when they
house the seat of the State Government and are to provide for its continuous operation and when these buildings are
some of the most architecturally or historically significant of the State's structures. The Legislature declares that the
State House, the State House Annex and ancillary structures, the War Memorial, the Old Barracks, the Kelsey
Building and the townhouses adjacent to the Kelsey Building are the buildings or constitute the project which are
subject to the provisions of subsection b. of this section.
b. Notwithstanding the provisions of R.S. 52:32-2 and section 11 of P.L.1981, c.120 to the contrary, in the case of
the erection, construction, alteration or repair of the State House, State House Annex and ancillary structures, the
War Memorial, the Old Barracks, the Kelsey Building and the townhouses adjacent to the Kelsey Building, as public
buildings or a project of the New Jersey Building Authority, if the board, body or person authorized by law to award
contracts for the work on the public building, or the authority for the work on the project, finds that such a building
or project:
(1) requires a unique application of specialized planning, management and operational strategies, skills and
techniques;
(2) requires that construction management personnel, engineers, architects and contractors whose skills and
expertise will best identify, display and protect the historical, architectural, cultural and artistic significance of the
building or project be employed for its planning, design and construction, renovation or restoration; and
(3) must be completed in the most efficient and timely manner, then the board, body or person authorized by law to
award the contracts, or the authority, may (a) by advertising and receiving bids in the form of a single contract,
multiple branch contracts, or both, award the contract to the lowest responsible bidder or bidders, as determined by
the board, body, person, or authority; or (b) in order to further the purposes of this section, by inviting bids for the
single contract, multiple branch contracts, or both, from among a list of qualified bidders, in a manner that will
promote full and free competition whenever practicable, award the contract or contracts to that responsible bidder
from among the invited bidders whose bid, conforming to the invitation for bids, will be most advantageous to the
State, price and other factors considered.
N.J.S.A. 52:32-2.3. Correctional facilities
a. The Legislature further finds that the "Correctional Facilities Construction Bond Act of 1987" provides for
projects for the construction of correctional facilities that are required because of a critical public need or legal
constraint, with respect to which there are similar needs to employ construction management personnel, engineers,
architects and contractors of special skills and expertise; and that these projects will provide for buildings for the
immediate housing or care of their residents or inmates.
b. Notwithstanding the provisions of R.S. 52:32-2 and section 11 of P.L. 1981, c. 120 to the contrary, in the case of
the erection or construction of a public building or project of the New Jersey Building Authority, if the board, body
or person authorized by law to award contracts for the work on the public building, or the authority for the work on
the project, finds that such building or project:
(1) requires a unique application of specialized planning, management and operational strategies, skills and
techniques; and
(2) requires that construction management personnel, engineers, architects and contractors whose skills and
expertise will ensure the completion of the building or project in the most efficient and timely manner be employed
for its planning, design and construction; then the board, body or person authorized by law to award the contracts, or
the authority, may, by advertising and receiving bids in the form of a single contract, multiple branch contracts, or
both, award the contract to the lowest responsible bidder or bidders, as determined by the board, body, person, or
authority. There shall be set forth in the bid the name or names of, and evidence of performance security from, all
subcontractors to whom the bidder will subcontract the furnishing of plumbing and gas fitting, and all kindred work,
and of the steam and hot water heating and ventilating apparatus, steam power plants and kindred work, and
electrical work, structural steel and ornamental iron work, each of which subcontractors shall be qualified in
accordance with Title 52 of the Revised Statutes.
DPMC STATUTORY AUTHORITY: DESIGN AND CONSTRUCTION
Energy Savings Improvement Projects
N.J.S.A. 52:34-25 Implementation of energy savings improvement program by State contracting agency;
definitions
a. (1) A State contracting agency, as defined in this section, may implement an energy savings improvement
program in the manner provided by this section whenever it determines that the savings generated from reduced
energy use from the program will be sufficient to cover the cost of the program's energy conservation measures as
set forth in an energy savings plan. Under such a program, a contracting agency may enter into an energy savings
services contract with an energy services company to implement the program or the contracting agency may
authorize separate contracts to implement the program. The provisions of Title 52 of the Revised Statutes shall apply
to any contracts awarded pursuant to this section to the extent that the provisions of such law are not inconsistent
with any provision of this section.
(2) A State contracting agency facility alteration required to properly implement other energy efficiency or energy
conservation measures, or both, may be included as part of an energy savings services contract, in which case,
notwithstanding any other provision of law, rule, regulation, or order to the contrary, the facility alteration may be
undertaken or supervised by the energy services company performing the energy savings services contract if:
(a) the total cost of the improvement does not exceed 15 percent of the total cost of the work to be performed under
the energy savings services contract; and
(b) (i) the improvement is necessary to conform to a law, rule, or regulation, or order, or (ii) an analysis within an
approved proposal, or the State contracting agency, at the time of the award of the proposal, demonstrates that there
is an economic advantage to the State contracting agency implementing the improvement as part of the energy
savings services contract, and the savings rationale for the improvement is documented and supported by reasonable
justification.
b. (1) To be eligible to enter into an energy savings services contract, an energy services company shall be a
commercial entity that is qualified to provide energy savings services in accordance with the provisions of this
section. A State contracting agency may determine to enter into an energy savings services contract through public
advertising for bids and the receipt of bids therefor.
(2) (a) Public works activities performed under an energy savings improvement program shall be subject to all
requirements regarding public bidding, bid security, performance guarantees, insurance and other public contracting
requirements that are applicable to public works contracts, to the extent not inconsistent with this section. A general
contractor, energy services company serving as general contractor, or any subcontractor hired for the furnishing of
plumbing and gas fitting and all kindred work, and of steam and hot water heating and ventilating apparatus, steam
power plants and kindred work, and electrical work, structural steel and ornamental iron work, shall be classified by
the Division of Property Management and Construction in the Department of the Treasury in order to perform public
works activities under an energy savings improvement program. A general contractor, energy services company
serving as general contractor, or any subcontractor hired for the furnishing of electrical work shall use only electrical
contractors licensed by the State, pursuant to P.L.1962, c.162, to perform electrical work under an energy savings
improvement program. Electrical work shall include, but not be limited to, the wiring of temperature and energy
management controls, the installation of control systems, and the retrofitting of any lighting equipment.
(b) Individuals or organizations performing energy audits, acting as commissioning agents, or conducting
verification of energy savings plans, implementation of energy conservation measures, or verifying guarantees shall
be prequalified by the Division of Property Management and Construction in the Department of the Treasury to
perform their work under an energy savings improvement program.
(3) (a) An energy services company may be designated as the general contractor for improvements to be made
pursuant to an energy savings plan, provided that the hiring of subcontractors that are required to be classified
pursuant to subparagraph (a) of paragraph (2) of this subsection shall be performed in accordance with the
procedures and requirements set forth pursuant to subparagraph (b) of this paragraph. A contract with an energy
savings company shall include, but not be limited to: preparation of an energy savings plan, the responsibilities of
the parties for project schedules, installations, performance and quality, payment of subcontractors, project
completion, commissioning, savings implementation; a requirement that the savings to be achieved by energy
conservation measures be verified upon commissioning of the improvements; allocation of State and federal rebates
and tax credits; and any other provisions deemed necessary by the parties.
(b) Notwithstanding any other law or regulation to the contrary, an energy services company shall select, in
accordance with the procedures and requirements set forth pursuant to the public bidding process of the State
contracting agency, only those subcontractors that have been pre-qualified by the Division of Property Management
and Construction as eligible to submit bids. In pre-qualifying subcontractors for eligibility, the division shall create
one or more pools of subcontractors based on the value and complexity of the work to be undertaken under an
energy savings improvement program. The pre-qualification pools shall include subcontractors having the following
qualifications:
(i) the financial means and ability to complete the required work;
(ii) the experience, capability, and skills necessary to complete the work required of energy savings improvement
program projects; and
(iii) a record of experience conducting similar work in a timely fashion.
Each subcontractor chosen by the energy services company shall certify that all employees have completed a
registered apprenticeship program that provided each trainee with combined classroom and on-the-job training under
the direct and close supervision of a highly skilled worker in an occupation recognized as an apprenticeable trade,
registered by the Office of Apprenticeship of the United States Department of Labor and meeting the standards
established by the office, or registered by a State apprenticeship agency recognized by the office. The energy
services company shall then select from the eligible pools of prequalified subcontractors. All workers performing
public works activities for subcontractors awarded contracts by an energy services company pursuant to this section
shall be paid prevailing wages in accordance with the "New Jersey Prevailing Wage Act," P.L.1963, c.150. All
subcontractors shall comply with the provisions of "The Public Works Contractor Registration Act," P.L.1999,
c.238. Only firms appropriately classified as contractors by the Division of Property Management and Construction
shall be eligible to be awarded a contract as a subcontractor of an energy services company under this section for
performing public works activities pursuant to regulations adopted by the Division of Property Management and
Construction.
(c) In order to expedite communications with an energy services company and facilitate the implementation of an
energy savings improvement program, a State contracting agency may designate or appoint an employee of the State
contracting agency with decision-making authority to coordinate with the energy services company and to address
issues associated with the implementation of an energy savings improvement program as they arise, provided that
any decision requiring a change order shall be made only upon the approval of the State contracting agency.
(4) A subsidiary or wholly-owned or partially-owned affiliate of the energy services company shall not be an
eligible contractor or subcontractor under an energy savings services contract.
c. In addition to existing authorization of a State agency to enter into lease-purchase agreements or to issue
obligations to finance the costs of an energy savings improvement program, a contracting agency is hereby
authorized to finance the costs of an energy savings improvement program by entering into a lease purchase
agreement. Any financing mechanism shall be administered in a manner consistent with this subsection insofar as it
does not conflict with the provisions of other law that applies to the contracting agency.
(1) An energy savings improvement program may be financed through a lease-purchase agreement between a State
contracting agency and an energy services company or other public or private entity. Under a lease-purchase
agreement, ownership of the energy savings equipment or improved facilities shall pass to the contracting agency or
the client agency responsible for the facility when all lease payments have been made. Notwithstanding the
provisions of any other law to the contrary, the duration of such a lease-purchase agreement shall not exceed 15
years, except that the duration of a lease purchase agreement for a combined heat and power or cogeneration project
shall not exceed 20 years. For the purposes of this paragraph, the duration of the repayment term of a lease-purchase
agreement shall commence on the date upon which construction and installation of the energy savings equipment,
"combined heat and power facility" or "cogeneration facility," as those terms are defined pursuant to section 3 of
P.L.1999, c.23, or other energy conservation measures undertaken pursuant to the energy savings plan, have been
completed.
(2) Lease-purchase agreements and energy savings obligations shall not be used to finance maintenance, guarantees,
or verification of guarantees of energy conservation measures. Lease-purchase agreements may be used to finance
the cost of an energy audit or the cost of verification of energy savings as part of adopting an energy savings plan.
Maturity schedules of lease-purchase agreements shall not exceed the estimated average useful life of the energy
conservation measures.
d. (1) The energy audit component of an energy savings improvement program shall be conducted either by the
contracting agency or by a qualified independent third party retained by the contracting agency for that purpose. It
shall not be conducted by an energy services company subsequently hired to develop an energy savings
improvement program. The energy audit shall identify the current energy use of any or all facilities and energy
conservation measures that can be implemented in which the energy savings and energy efficiency could be realized
and maximized.
(2) To implement an energy savings improvement program, a contracting agency shall develop an energy savings
plan that consists of one or more energy conservation measures. The plan shall:
(a) contain the results of an energy audit;
(b) describe the energy conservation measures that will comprise the program;
(c) estimate greenhouse gas reductions resulting from those energy savings;
(d) identify all design and compliance issues that require the professional services of an architect or engineer and
identify who will provide these services;
(e) include an assessment of risks involved in the successful implementation of the plan;
(f) identify the eligibility for, and costs and revenues associated with the PJM Independent System Operator for
demand response and curtailable service activities;
(g) include schedules showing calculations of all costs of implementing the proposed energy conservation measures
and the projected energy savings;
(h) identify maintenance requirements necessary to ensure continued energy savings, and describe how they will be
fulfilled; and
(i) if developed by an energy services company, a description of, and cost estimates of an energy savings guarantee.
All professionals providing engineering services under the plan shall have errors and omissions insurance.
(3) Prior to the adoption of the plan, the contracting agency shall contract with a qualified third party to verify the
projected energy savings to be realized from the proposed program have been calculated as required by subsection e.
of this section.
(4) Upon adoption, the plan shall be submitted to the Board of Public Utilities, which shall post it on the Internet on
a public webpage maintained for such purpose. If the contracting agency maintains its own website, it shall also post
the plan on that site. The Board of Public Utilities may require periodic reporting concerning the implementation of
the plan.
(5) Verification by a qualified third party shall be required when energy conservation measures are placed in service
or commissioned, to ensure the savings projected in the energy savings plan shall be achieved.
(6) Energy-related capital improvements that do not reduce energy usage may be included in an energy savings
improvement program but the cost of such improvements shall not be financed as a lease-purchase or through
energy savings obligations authorized by subsection c. of this section. Nothing herein is intended to prevent
financing of such capital improvements through otherwise authorized means.
(7) A qualified third party when required by this subsection may include an employee of the State contracting
agency who is properly trained and qualified to perform such work.
e. (1) (a) The calculation of energy savings for the purposes of determining that the energy savings resulting from
the program will be sufficient to cover the cost of the program's energy conservation measures, as provided in
subsection a. of this section, shall involve determination of the dollar amount saved through implementation of an
energy savings improvement program using the guidelines of the International Performance Measurement and
Verification Protocol or other protocols approved by the Board of Public Utilities and standards adopted by the
Board of Public Utilities pursuant to this section. The calculation shall include all applicable State and federal
rebates and tax credits, but shall not include the cost of an energy audit and the cost of verifying energy savings. The
calculation shall state which party has made application for rebates and credits and how these applications translate
into energy savings.
(b) During the procurement phase of an energy savings improvement program, an energy services company's
proposal submitted in response to a request for proposal shall not include a savings calculation that assumes,
includes, or references capital cost avoidance savings, the current or projected value of a "solar renewable energy
certificate," as defined pursuant to section 3 of P.L.1999, c.23, or other environmental or similar attributes or
benefits of whatever nature that derive from the generation of renewable energy, and any costs or discounts
associated with maintenance services, an energy savings guarantee, or third party verification of energy conservation
measures and energy savings. The calculation of energy savings shall utilize and specifically reference as a
benchmark the actual demand and energy components of the public utility tariff rate applicable to the State
contracting agency then in effect, and not a blended rate that aggregates, combines, or restates in any manner the
distinct demand and energy components of the public utility tariff rate into a single combined or restated tariff rate.
If an energy services company submits a proposal to a State contracting agency that does not calculate projected
energy savings in the manner required by this subsection, such proposal shall be rejected by the State contracting
agency.
(2) For the purposes of this section, the Board of Public Utilities shall adopt standards and uniform values for
interest rates and escalation of labor, electricity, oil, and gas, as well as standards for presenting these costs in a life
cycle and net present value format, standards for the presentation of obligations for carbon reductions, and other
standards that the board may determine necessary.
f. (1) When an energy services company is awarded an energy savings services contract, it shall offer the contracting
agency the option to purchase, for an additional amount, an energy savings guarantee. The guarantee, if accepted by
the contracting agency, shall insure that the energy savings resulting from the energy savings improvement program,
determined periodically over the duration of the guarantee, will be sufficient to defray all payments required to be
made pursuant to the lease-purchase agreement or energy savings obligation, and if the savings are not sufficient, the
energy services company will reimburse the contracting agency for any additional amounts. Annual costs of a
guarantee shall not be financed or included as costs in an energy savings plan but shall be fully disclosed in an
energy savings plan.
(2) When a guaranteed energy savings option is purchased, the contract shall require a qualified third party to verify
the energy savings at intervals established by the parties.
(3) When an energy services company is awarded an energy savings services contract to provide or perform goods
or services for the purpose of enabling a State contracting agency to conserve energy through energy efficiency
equipment, including a "combined heat and power facility" as that term is defined pursuant to section 3 of P.L.1999,
c.23, on a self-funded basis, such contract shall extend for a term of up to 15 years for energy efficiency projects,
and for up to 20 years for a combined heat and power facility after construction completion. If a State contracting
agency shall elect to contract with an energy services company for an energy savings guarantee in connection with a
contract awarded pursuant to this section, such guarantee may extend for a term of up to 15 years for energy
efficiency projects, or up to 20 years for a combined heat and power facility after construction completion.
g. As used in this section:
"energy conservation measure" means an improvement that results in reduced energy use, including, but not limited
to, installation of energy efficient equipment; demand response equipment; combined heat and power systems;
facilities for the production of renewable energy; water conservation measures, fixtures or facilities; building
envelope improvements that are part of an energy savings improvement program; and related control systems for
each of the foregoing;
"energy related capital improvement" means a capital improvement that uses energy but does not result in a
reduction of energy use;
"energy savings" means a measured reduction in fuel, energy, operating or maintenance costs resulting from the
implementation of one or more energy conservation measures services when compared with an established baseline
of previous fuel, energy, operating or maintenance costs, including, but not limited to, future capital replacement
expenditures avoided as a result of equipment installed or services performed as part of an energy savings plan;
"energy savings improvement program" means an initiative of a State contracting agency to implement energy
conservation measures in existing facilities, provided that the value of the energy savings resulting from the program
will be sufficient to cover the cost of the program's energy conservation measures;
"energy savings plan" means the document that describes the actions to be taken to implement the energy savings
improvement program;
"energy savings services contract" means a contract with an energy savings company to develop an energy savings
plan, prepare bid specifications, manage the performance, provision, construction, and installation of energy
conservation measures by subcontractors, to offer a guarantee of energy savings derived from the implementation of
an energy savings plan, and may include a provision to manage the bidding process;
"energy services company" means a commercial entity that is qualified to develop and implement an energy savings
plan in accordance with the provisions of this section;
"public works activities" means any work subject to the provisions of P.L.1963, c.150;
"State contracting agency" or "contracting agency" means any of the principal departments in the Executive Branch
of State Government, and any division, board, bureau, office, commission or other instrumentality created by a
principal department; and
"water conservation measure" means an alteration to a facility or equipment that reduces water consumption,
maximizes the efficiency of water use, or reduces water loss.
h. (1) The State Treasurer and the Board of Public Utilities may take such action as is deemed necessary and
consistent with the intent of this section to implement its provisions.
(2) The State Treasurer and the Board of Public Utilities may adopt implementation guidelines or directives, and
adopt such administrative rules, pursuant to the "Administrative Procedure Act," P.L.1968, c.410, as are necessary
for the implementation of those agencies' respective responsibilities under this section, except that notwithstanding
any provision of P.L.1968, c.410 to the contrary, the State Treasurer, and the Board of Public Utilities may adopt,
immediately upon filing with the Office of Administrative Law, such rules and regulations as deemed necessary to
implement the provisions of this act which shall be effective for a period not to exceed 12 months and shall
thereafter be amended, adopted or re-adopted in accordance with the provisions of P.L.1968, c.410
N.J.S.A. 52:34-25.1. State contracting agency, competitive selection process
a. Notwithstanding the provisions to the contrary of R.S.52:32-2 or any other law, or any rule or regulation adopted
pursuant thereto, where a State contracting agency implements an energy savings improvement program pursuant to
section 9 of P.L.2009, c.4, the State contracting agency, prior to entering into an energy savings services contract,
shall use a competitive selection process that ensures that the award is made to the responsible bidder whose
proposal is determined to be the most advantageous to the State.
b. Nothing in this section shall preclude a State contracting agency from using procurement processes other than
those prescribed herein and in section 9 of P.L.2009, c.4, if those processes have been approved by the federal
government under section 801 of the "National Energy Conservation Policy Act".
c. The Division of Property Management and Construction in the Department of the Treasury shall not charge any
fee for the review or approval of an energy savings improvement program implemented by a State contracting
agency pursuant to section 9 of P.L.2009, c.4 (C.).